April 1, 2015
PayPal is poised to pay $7.7 million to the U.S. government in light of payments that have violated sanctions against Iran, Cuba, and Sudan, as reported by BBC. These illegal transactions had occurred due to inadequate screening by PayPal. PayPal is working on improving it's real-time payments system. The delays in scanning had led to the illegal payments, as cited by the payments firm. There had been 500 PayPal transactions that had violated the sanctions. The violations were related to processing payments that had been blacklisted by the U.S. Treasury Department.
PayPal is trying its best to improve its security measures in order to keep millions of dollars safer online. While PayPal does possess industry-leading fraud models and verification techniques, along with a world-class security team, the company is always looking for ways to make it’s systems even more secure to stay well ahead of cybersecurity threats.
PayPal had recently announced the setup of a new security center in Israel. Located in one of the world’s top cybersecurity hubs, this new security center will help the company with tapping into the country’s cutting-edge technology and top cybersecurity talent. PayPal’s primary goal is to extend its global security leadership, and bolster its efforts in predictive threat detection and prevention. The creation of the security center is an extension of the capabilities that PayPal has already developed through the success of its Fraud and Risk Detection Center in Tel Aviv.
We had recently talked about PayPal adopting the Deep Learning approach to fight against criminals who attempt to exploit the online payments platform. PayPal’s efforts towards utilizing Deep Learning systems can be seen in its current anti-fraud systems. The Deep Learning systems have been effective in analyzing factors such as timelines, location, etc. as part of payment transactions. PayPal is also utilizing this Deep Learning methodology to determine which fraud-detection models will be implemented. Such techniques would indeed be helpful in bringing more effective screening of transactions that too run in realtime.
The U.S. government has indeed been tough on financial institutions as well, scrutinizing their transaction blocking systems closely. Many banks have faced heavy fines in the past. Now, regulators are also keeping a close eye on payment processing firms like PayPal.